A P45 is the tax document your UK employer gives you when you leave a job. It records how much you earned and how much income tax you paid at that job during the current tax year, so your next employer can deduct the right amount of tax from your pay. It comes in four parts, and what you do with each part in the days after you leave decides whether you start your next job on the correct tax code or overpay for weeks while things sort themselves out.
The figures on a P45 run from the start of the UK tax year, 6 April, to your leaving date, not from January.1GOV.UK. Self Assessment Tax Returns: Deadlines Leave a job in February and the form covers roughly ten months; leave in May and it covers about one.
What’s on the Form and Where Each Part Goes
A P45 is a four-part form, and each part has a different destination.2HM Revenue and Customs. P45 Manual
- Part 1 goes to HMRC, or is submitted through your employer’s payroll software as part of the Full Payment Submission.
- Part 1A is your personal copy. Keep it.
- Parts 2 and 3 go to your next employer, or to Jobcentre Plus if you’re claiming Jobseeker’s Allowance or Employment and Support Allowance.
Whichever part you’re looking at, the core information is the same: your tax code on your leaving date, your National Insurance number, total pay and total tax so far in the tax year, your employer’s PAYE reference, and your leaving date.2HM Revenue and Customs. P45 Manual Most employers now produce the form through payroll software, so you’ll usually receive Parts 1A, 2, and 3 as a printed or electronic document rather than a handwritten form.3GOV.UK. Getting P45, P60 and Other Forms: Employer Guide
What To Do With Each Part
If you’re going straight into another job, hand Parts 2 and 3 to your new employer as soon as you can. Those figures tell payroll how much of your tax-free personal allowance you’ve already used and what tax code to apply. Without them, your new employer has no way to know, and the default assumption costs you money.2HM Revenue and Customs. P45 Manual
If you’re not going straight into work and plan to claim Jobseeker’s Allowance or Employment and Support Allowance, bring the P45 to your Jobcentre Plus interview. It proves your recent earnings and can also count toward proving your identity.4GOV.UK. Jobseeker’s Allowance: Your JSA Interview Signing on also keeps your National Insurance contributions ticking over, which matters for your eventual State Pension even if your household income is too high for the benefit itself.
Keep Part 1A whatever happens next. It’s your personal record of pay and tax at that job, and you may need it later for a Self Assessment return or if a tax figure is ever queried.
What Happens If You Don’t Give Your New Employer a P45
This is where most people lose money. Start a new job without handing over Parts 2 and 3, and your employer will put you on an emergency tax code. The standard emergency code is 1257L followed by W1, M1, or X.5GOV.UK. Understanding Your Employees’ Tax Codes: Overview You still get the standard personal allowance, but it’s applied on a “week 1” or “month 1” basis, meaning each pay period is taxed in isolation rather than as part of a running total for the year.
In practice, the code treats that pay period’s earnings as if you’ll earn the same amount every period, ignoring what you actually earned or already paid at your previous job. Depending on your circumstances, you can pay noticeably more tax than you owe.6GOV.UK. Emergency Tax Codes The code stays until HMRC updates your records, which can take weeks.
Overpaid tax does come back. Once HMRC has the correct information, it tells your employer to refund the difference through your pay. For monthly-paid employees, the refund usually appears in the next pay packet or the one after; for weekly-paid employees, typically within three pay periods.7GOV.UK. Tax Codes: If You’ve Paid Too Much or Too Little Tax Your cash flow takes the hit in the meantime, so handing the form over on day one is worth the effort.
If You Can’t Produce a P45: The Starter Checklist
Sometimes you genuinely can’t hand one over. Your old employer hasn’t sent it yet, you’ve lost it, this is your first job, or you’re coming back to work after a long break. In those cases your new employer should ask you to fill in a Starter Checklist.8GOV.UK. Starter Checklist if You’re Starting a New Job It asks you to pick one of three statements:
- Statement A: this is your first job since 6 April, and you haven’t received Jobseeker’s Allowance, Employment and Support Allowance, or Incapacity Benefit. Your employer applies the full personal allowance on a cumulative basis.
- Statement B: you’ve had another job since 6 April but don’t have a P45, or you’ve received one of the benefits above. Your employer applies the personal allowance on a week 1/month 1 basis, the same effect as an emergency code.
- Statement C: you have another job as well, or you receive a State, workplace, or private pension. Your employer uses the basic rate code (BR), taxing all earnings at 20% with no personal allowance.
Read each statement carefully. Picking the wrong one leads to incorrect deductions that can take months to unravel.9HM Revenue and Customs. Starter Checklist The checklist also collects student loan and postgraduate loan information, which affects your deductions separately from income tax.
When Should Your Employer Give You a P45
Under Regulation 36 of the Income Tax (Pay As You Earn) Regulations 2003, your employer must complete your P45 and hand you Parts 1A, 2, and 3 on the day your employment ends. If that’s not practicable, they must do so “without unreasonable delay.”10Legislation.gov.uk. Income Tax (Pay As You Earn) Regulations 2003 – Regulation 36 HMRC doesn’t set an exact number of days, but in practice most employers issue the form after processing your final pay run.
If your former employer is slow, ask in writing first. If they still don’t produce it, report the delay to HMRC, which can investigate the employer’s PAYE compliance and require them to issue the form. In the meantime, complete a Starter Checklist at your new job so your deductions are at least roughly right while you wait.
P45 vs. P60
People often mix up the P45 and the P60. The distinction is timing. A P45 appears mid-year when you leave a job and covers only your time there. A P60 is an end-of-year summary: if you’re employed on 5 April, the last day of the UK tax year, your employer must give you a P60 by 31 May, showing your total pay and tax for the whole tax year at that job.11GOV.UK. Your P45, P60 and P11D Form You get a separate P60 from each employer you have on 5 April.
If You’re an American Who Worked in the UK
A P45 is a UK document and doesn’t satisfy any US filing requirement on its own. It’s still useful. American citizens and green card holders owe US federal income tax on worldwide income, and the figures on your P45 help you convert your UK earnings to dollars for a US return, whether you’re claiming the Foreign Earned Income Exclusion on Form 255512Internal Revenue Service. About Form 2555, Foreign Earned Income or taking a Foreign Tax Credit for income tax you already paid to HMRC under the UK-US Double Taxation Convention.13GOV.UK. UK/USA Double Taxation Agreement – 2002 Keep Part 1A with your US tax records, not just your UK ones.